Chancellor announces more support for all business impacted by Covid restrictions

The Chancellor’s update today responded to the calls from many business leaders and organisations – the need for greater support for those businesses which aren’t forced to close by the restrictions, but whose trade has been severely impacted as a result of Covid restrictions, particularly in the areas of hospitality and leisure.

Many had been expecting the provision just to be available for those businesses located in tier 2, deemed ‘high risk’ areas, but the Chancellor has gone further and expanded the support to be available to any business impacted by the restrictions, regardless of location, tier or sector. This support is available for all businesses across the UK

Job Support Scheme

  • For businesses which remain open, but are operating at reduced capacity, the updates to the scheme are:
    • Employees now only have to work 20% of their normal hours (a reduction from 33%), of which they are required to be paid in full by the employer
    • The additional employer contribution for hours not worked has been reduced from 33% to now 5%
    • The government contribution will now be 62% for the hours not worked
    • An employee will now receive a maximum of  £1,541.75 per month
    • Employers will still be eligible to apply for the £1,000 Job Retention Bonus 
There is a requirement that the business can show it has been negatively impacted – but we don’t yet know how that will look.

It is worth noting that the Job Support Scheme measures previously announced by the Chancellor to support businesses which are forced to close by tier 3 restrictions, remain unchanged.

Business grants

  • Further grants will be available to hospitality businesses in tier 2 restrictions, which will be administered by Local Authorities.  Restaurants, hotels and B&Bs will be able to receive grants of up to £2,100 per month, during the course of the period that the tier 2 restrictions apply.  This is backdated to August if restrictions have applied already.
Self-Employment Income Support Scheme (SEISS)
  • Government support available to Self-Employed and Sole Traders has been doubled from 20% to 40% of trading profits, with a maximum grant of £3,750 per three-month period.

We’re still awaiting the details to be made available, but in summary, this expansion of provisions will provide a welcome level of additional support for employers – at a time when they are facing reduced demand and a pressure to make difficult staffing decisions.

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